Valuations are high in the listed space (the Top 30 players had an average sales multiple of ~1.9x at the end of 2017), which is supporting high transaction multiples in the European mid-market.

Digitalization of brick & mortar retail has become an important M&A driver: traditional retailers are increasingly acquiring e-commerce businesses to develop digital competencies that can be rapidly bolted on to existing operations.

We saw this when SIGNA Retail acquired outfitter.com in 2016/17 to improve Karstadt Sports’ online presence. [Note: Capitalmind’s e-commerce lead in Germany Jürgen Schwarz advised on this landmark transaction.]

Jürgen Schwarz

Partner

Germany

"The e-commerce market is being disrupted after a period of relatively easy growth between 2010 and 2015, as increasingly dominant market players and rising customer acquisition costs reduce margins and win market share from independent e-commerce shops. It's imperative that these businesses reach customer more directly, and M&A is often an effective way forward."

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